Discuss the importance of responsibility center-based accounting. Use at least two examples of different centers (cost center, profit center, and investment center). (10 points) Cost-volume-profit (CVP) analysis focuses on five factors that affect profits. Do you mention four (4) of those five factors? (4 points) Within a relevant range we can assume that total costs, both variable and fixed, behave linearly. Furthermore, suppose that everything produced is sold in its entirety. Based on these assumptions: What would be the basic formula to calculate the operating income of a manufacturing company? What would be the basic formula for the breakeven point in terms of units (break-even-point)? (3 points) The elements that you must take into consideration in the formula are: units produced and sold, variable costs, fixed costs.

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Responsibility centerbased accounting is crucial for effective management and decisionmaking within organizations It assigns responsibility for specif... View the full answer